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Marvel’s “Black Panther” film about an African prince with superpowers blindsided the movie industry in 2018 with its amazing run of success, proving the hitherto underappreciated appeal of the Africa brand. Now it appears the world of e-commerce could be similarly shaken up by Africa.
The old narrative of Africa on the margins, disconnected from the global economy, riven by conflict or corruption and heavily dependent on foreign intervention and donations, is fading fast. The internet is playing a big part in facilitating this change, hence the increasing relevance of e-commerce on this still much misunderstood continent.
Africa’s population is growing rapidly, especially its middle class, which is expected to make up 1.1 billion out of 2.5 billion Africans by 2050. And that mushrooming demographic, comprising professionals and business people with increasing disposable income, has a taste for Western goods: an obvious opportunity for e-commerce. McKinsey Global Institute projects e-commerce could be worth $75bn in Africa’s leading economies by 2025.
“At the moment, 90% of US and UK retailers don’t sell in Africa – so many brands have simply nixed Africa,” says Chris Folayan, CEO of MallforAfrica, an e-commerce platform that allows customers in 17 African countries to purchase directly from major international retailers that would otherwise be inaccessible.
“They have these amazing websites but can’t be accessed by African countries; these businesses have dismissed the continent for reasons I have no clue of – they just don’t see what the continent can do,” Folayan says. Saving retail?
He acknowledges that some foreign companies are put off by legitimate challenges such as language and cultural barriers, the lack of universal payment systems such as Visa and MasterCard, and by concerns over the likes of fraud and ingrained corruption. But, he points out, this is where partnerships with local companies like MallforAfrica come in, to “take care of all of that”.
Folayan also notes African e-commerce could help reverse the downward trajectory of retail in the US and UK, where online shopping is eating retail. In 2017 the $12.7bn revenue of US department stores was $7.2bn lower than it was in 2001, according to the US Census Bureau.
“I truly believe that Africa could save many [foreign] businesses,” Folayan says. “Even though retail is having a hard time, it still isn’t looking to Africa as a market where it could do business through online sales. Retail needs to look at Africa […]
